Lane Bryant Web Site Pays Off Without E-Commerce

In contrast to the scores of retailers struggling to turn a profit on their e-commerce operations, Lane Bryant claims that it's making money even though it doesn't sell any merchandise from its Web site.

The Reynoldsburg, Ohio-based women's apparel retailer spent less than $500,000 on its Web site last year, yet it traced $21.2 million in store sales to the electronic coupons and bar-coded gift certificates it e-mailed to registered customers, according to Jennifer Campbell Peterson, director of brand development.

Gift certificate sales grew 20% from 1998 through 2001, with $500,000 of the $3 million in total sales via the Web site, she added. "We're scrappy," Campbell Peterson said. "We don't have a big budget. We use guerrilla tactics to get a huge bang for our buck."

Lane Bryant launched its site in 1997 as a tool to help it change its image as a "dowdy brand for grandma," Campbell Peterson said. Now, the e-mail database contains more than 1 million names, and the site logs 700,000 unique visitors per month, with its ChickChat customer forum attracting the most usage.

The site's 3-D virtual models have drawn 250,000 people to try on clothes displayed through the site, and 387 television stations have aired news stories about the site, including 52 in major markets, according to brand development manager Becki Rundels. One recent webcast of a Lane Bryant fashion show, featuring the rock band Kiss, drew 65,000 viewers.

Data analysis has shown that 40% of the Web visitors are new customers who haven't made a trackable purchase in any of Lane Bryant's 653 stores or turned up on any direct-mail lists, Campbell Peterson noted. She said Lane Bryant would love to make its site transactional because surveys have overwhelmingly shown that customers "want it so desperately." And she said she has even started to sense some customers harboring "a little incredulous attitude that we don't have one."

But e-commerce wasn't an option under Lane Bryant's former parent company, The Limited Inc. in Columbus, Ohio, which hadn't made it a priority, Campbell Peterson said. The new owner, Bensalem, Pa.-based Charming Shoppes Inc., has shown interest in making the site transactional, and Campbell Peterson hopes Lane Bryant will launch e-commerce next year.

"For certain types of goods and services, consumers are really beginning to expect that," said Dyan Triffo, a financial analyst at Deutsche Banc Alex. Brown.

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Copyright © 2002 IDG Communications, Inc.

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